There are advantages and disadvantages of using a functional placement for a project, assuming that the

organization is functionally organized.

The major advantages are:

1. There is maximum flexibility in the use of staff. If the proper functional division has been chosen as
the project’s home, the division will be the primary administrative base for individuals with technical
expertise in the fi elds relevant to the project. Experts can be temporarily assigned to the project, make
the required contributions, and immediately be reassigned to their normal work.

2. Individual experts can be utilized by many different projects. With the broad base of technical
personnel available in the functional divisions, people can be switched back and forth between the
different projects with relative ease.

3. Specialists in the division can be grouped to share knowledge and experience. Therefore, the project
team has access to whatever technical knowledge resides in the functional group. This depth of
knowledge is a potential source of creative, synergistic solutions to technical problems.

4. The functional division also serves as a base of technological continuity when individuals choose to
leave the project, and even the parent fi rm. Perhaps just as important as technological continuity is the
procedural, administrative, and overall policy continuity that results when the project is maintained in a
specific functional division of the parent firm.

5. Finally, and not the least important, the functional division contains the normal path of advancement
for individuals whose expertise is in the functional area. The project may be a source of glory for those
who participate in its successful completion, but the functional fi eld is their professional home and the
focus of their professional growth and advancement.

Just as there are advantages to using a functional placement, there are also disadvantages:

1. A primary disadvantage of this arrangement is that the client is not the focus of activity and concern.
The functional unit has its own work to do, which usually takes precedence over the work of the project,
and hence over the interests of the client.

2. The functional division tends to be oriented toward the activities particular to its function. It is not
usually problem oriented in the sense that a project should be to be successful.

3. Occasionally in functionally organized projects, no individual is given full responsibility for the project.
This failure to pinpoint responsibility usually means that the PM is made accountable for some parts of
the project, but another person is made accountable for one or more other parts. Little imagination is
required to forecast the lack of coordination and chaos that results.

4. The same reasons that lead to lack of coordinated effort tend to make response to client needs slow
and arduous. There are often several layers of management between the project and the client.

5. There is a tendency to suboptimize the project. Project issues that are directly within the interest area
of the functional home may be dealt with carefully, but those outside normal interest areas may be
given short shrift, if not totally ignored.
6. The motivation of people assigned to the project tends to be weak. The project is not in the
mainstream of activity and interest, and some project team members may view service on the project as
a professional detour.

7. Such an organizational arrangement does not facilitate a holistic approach to the project. Complex
technical projects such as the development of a jet transport aircraft or an emergency room in a hospital
simply cannot be well designed unless they are designed as a totality. No matter how good the
intentions, no functional division can avoid focusing on its unique areas of interest. Cross-divisional
communication and sharing of knowledge is slow and difficult at best.

As with the functional organization, standalone projects have unique advantages and disadvantages.

The former are:

1. The project manager has full line authority over the project. Though the PM must report to a senior
executive in the parent organization, there is a complete work force devoted to the project. The PM
is like the CEO of a fi rm that is dedicated to carrying out the project.
2. 2. All members of the project work force are directly responsible to the PM. There are no functional
division heads whose permission must be sought or whose advice must be heeded before making
technological decisions. The PM is truly the project director.
3. When the project is removed from the functional division, the lines of communication are
shortened. The entire functional structure is bypassed, and the PM communicates directly with
senior corporate management. The shortened communication lines result in faster communications
with fewer communication failures.
4. When there are several successive projects of a similar kind, the projectized organization can
maintain a more or less permanent cadre of experts who develop considerable skill in specific
technologies. Indeed, the existence of such skill pools can attract customers to the parent fi rm.
Lockheed’s famous “Skunk Works” was such a team of experts who took great pride in their ability
to solve difficult engineering problems. The group’s name, taken from the Li’l Abner comic strip,
reflects the group’s pride, irreverent attitude, and strong sense of identity.
5. The project team that has a strong and separate identity of its own tends to develop a high level of
commitment from its members. Motivation is high and acts to foster the task orientation discussed
in Chapter 3.
6. Because authority is centralized, the ability to make swift decisions is greatly enhanced. The entire
project organization can react more rapidly to the requirements of the client and the needs of
senior management.
7. Unity of command exists. While it is easy to overestimate the value of this particular organizational
principle, there is little doubt that the quality of life for subordinates is enhanced when each
subordinate has one, and only one, boss.
8. Projectized organizations are structurally simple and flexible, which makes them relatively easy to
understand and to implement.
9. The organizational structure tends to support a holistic approach to the project. A brief explanation
of the systems approach was given in Chapter 3, and an example of the problems arising when the
systems approach is not used appears in Section 5.3 of this chapter. The dangers of focusing on and
 optimizing the project’s subsystems rather than the total project are often a major cause of
technical failure in projects.

While the advantages of the projectized organization make a powerful argument favoring this structure,
its disadvantages are also serious:

1. When the parent organization takes on several projects, it is common for each one to be fully staffed.
This can lead to considerable duplication of effort in every area from clerical staff to the most
sophisticated (and expensive) technological support units. If a project does not require a full-time
personnel manager, for example, it must have one nonetheless because personnel managers come in
integers, not fractions, and staff is usually not shared across projects.

2. In fact, the need to ensure access to technological knowledge and skills results in an attempt by the
PM to stockpile equipment and technical assistance in order to be certain that it will be available when
needed. Thus, people with critical technical skills may be hired by the project when they are available
rather than when they are needed. Similarly, they tend to be maintained on the project longer than
needed, “just in case.” Disadvantages 1 and 2 combine to make this way of organizing projects very
expensive.

3. Removing the project from technical control by a functional department has its advantages, but it
also has a serious disadvantage if the project is characterized as “high technology.” Though individuals
engaged with projects develop considerable depth in the technology of the project, they tend to fall
behind in other areas of their technical expertise. The functional division is a repository of technical
lore, but it is not readily accessible to members of the standalone project team.

4. Projectized project teams seem to foster inconsistency in the way in which policies and procedures
are carried out. In the relatively sheltered environment of the project, administrative corner-cutting is
common and easily justified as a response to the client or to technical exigency. “They don’t understand
our problems” becomes an easy excuse for ignoring dicta from headquarters.

5. In projectized organizations, the project takes on a life of its own. Team members form strong
attachments to the project and to each other. A disease known as projectitis develops. A strong “we–
they” divisiveness grows, distorting the relationships between project team members and their
counterparts in the parent organization. Friendly rivalry may become bitter competition, and political
infighting between projects is common.

6. Another symptom of projectitis is the worry about “life after the project ends.” Typically, there is
considerable uncertainty about what will happen when the project is completed. Will team members be
laid off? Will they be assigned to low-prestige work? Will their technical skills be too rusty to be
successfully integrated into other projects? Will our team (“that old gang of mine”) be broken up.